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Candlestick Pattern Fictions
Resources for Advanced Trading


Candlestick Fictions

These disclosed fictions are "to the best of our knowledge" and provided as educational information to our visitors.

Candlestick Fictions

Japanese Candlesticks are the only analysis technique I need.

- False. Japanese Candlesticks are a very good analysis technique, but it is imporant to include other forms of analysis. For example, technical indicators, visual confirmation of trends, support/resistance, risk management and others.

Dojis are good top and bottom formation indicators.

- True. Although confirmation of a top or bottom is often required before actions should be taken.

Large patterns are better than small patterns.

- False. Japanese Candlesticks patterns come in all shapes and sizes. Traders should not reply on larger patterns over smaller patterns. They both have the potential for moving the markets.

Japanese Candlesticks work best on intra-day charts.

- Somewhat False. Japanese candlesticks were designed for use with weekly charts (or longer). They do work well with intra-day charts, but often intra-day trades need to use multiple time-frames. For example, using a 2 minute with a 5 and 10 minute will provide the day trader with the ability to watch the intermediate term trend and trade the short term trend.

 



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